Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-30885             January 23, 1930

ALFONSO TUASON Y ANGELES and MARIANO TUASON Y ANGELES, plaintiffs-appellees,

vs.
JUAN POSADAS, JR., Collector of Internal Revenue, defendant-appellant.

Attorney-General Jaranilla for appellant.

Salvador Franco for appellees.

AVANCEÑA, C.J.:

FACTS: Esperanza Tuason made a donation inter vivos of certain property to plaintiff Mariano
Tuason. Subsequently, she made another donation inter vivos to Alfonso Tuason, the other
plaintiff. When she died, her judicial administratrix paid the inheritance tax on these two
bequests. Furthermore, the defendant, Collector of Internal Revenue (CIR), collected sums from
the plaintiffs against their opposition and over their protest as inheritance tax upon the gifts
inter vivos made to them. Plaintiffs filed an action against the CIR for the recovery of the
amounts collected from them as inheritance tax. The judgment on appeal ordered the defendant
to return the amount collected. The defendant contends that law authorizes the collection of
these amounts as inheritance tax.

ISSUE: Whether the donations should be subjected to inheritance tax.

HELD: Yes.

When the law (sec. 1540, Administrative Code) says "all gifts," it refers to gifts inter vivos and
not mortis causa. Both the letter and the spirit of the law leave no room for any other
construction. Such, clearly, is the tenor of the language, which refers to donations that took
effect before the donor's death, and not to mortis causa donations, which can only be made with
the formalities of a will, and can only take effect after the donor's death.